OK guys, here's some actual in demo screenies I just took. Couple things to note from my perspective.
First, the water effects are a huge improvement over DX9. I'm sure with a little more tweaking they could be even better in DX10. The texture mapping of the rocks was pretty cool too. In the demo you can change the color of the lighting on the fly... doing so makes the scene look entirely different.
Overall it's cool, but I'm not all that impressed. The only thing to write home about is the water effects. And now the screenies...
(everything is at 1280x1024, 4x AA, 16X anistropic filtering... it ran well above 30FPS the entire time)
For anyone that cares, here's my system setup:
Athlon X2 4800+ (Toledo)
2GB of DDR500 RAM
XFX 8800 GTX
nForce 4 SLI motherboard
Vista Home Premium 64 bit